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Businesses And Goodwill Charges - College Essays

Businesses And Goodwill Charges

Outline of Wall Street Journal article on Goodwill

This article discusses changes in the way businesses record and report their "goodwill" charges.
Goodwill refers to the difference between the purchase price of a company's acquisition and the value of the acquired company's hard assets. Corporations that acquire a company at an inflated price can charge the loss to their books as an intangible asset called "goodwill."
Previous accounting standards required corporations to amortize these goodwill charges. They could write these charges off in small, regular chunks each quarter over years or decades, until the goodwill charges were gone.
New accounting standards, however, ...

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new accounting standards have key implications for companies like AOL, which earlier this year acquired Time Warner at what is now recognized as an inflated price. Companies like Lucent Technologies, and electronics manufacturers Sanmina and Solectron are also facing potential goodwill write-offs which could place their debt-to-capital ratios over limits agreed upon with creditors, resulting in major losses for their ...

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Businesses And Goodwill Charges. (2015, October 7). Retrieved January 22, 2025, from http://www.essayworld.com/essays/Businesses-And-Goodwill-Charges/105055

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PAPER DETAILS

Added: 10/7/2015 02:31:26 AM
Category: Business
Type: Premium Paper
Words: 244
Pages: 1

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